North Carolina Medicaid Changes

Posted on: October 9th, 2015

Revision to North Carolina’s Medicaid program has been a subject of much debate between the House and Senate over the past few months. Lawmakers recently reached compromises in a few key areas of House Bill 372 and ultimately agreed to privatize North Carolina’s Medicaid program.

One of the many areas of conflict surrounded administration of the program. Per the Senate’s requests, Medicaid would be managed by locally-created ‘provider-led’ entities (PLEs) and managed care companies. The House favored exclusive use of PLEs. Under the new legislation, two tiers of insurers will be created. The first divides the state into a handful of regions where PLEs created at the state-level can provide patient care. State contracts with PLEs would be capped at ten. Under the second tier, contracts will be offered to three insurers of Medicaid managed care programs, with PLEs competing for contracts alongside national managed care companies. Once the plans are established, patients will have the liberty to choose the plan they desire.

The new legislation removes the government’s responsibility to pay for patient expenses that exceed Medicaid coverage. The bill’s terms provide an 18-month grace period for hospitals to prepare for the Medicaid changes; however, proposals were made to extend this term to three-to-five years, as it will take time for the state to receive federal government approvals.

The new program terms mandate an enrollment fee paid by Medicaid to PLEs for each newly enrolled Medicaid patient. Previously, Medicaid paid for individual procedures and hospital visits as they occurred.

Another area of debate centered on the future contract with CCNC (Community Care of North Carolina). The CCNC program utilizes case managers to monitor patient care. Many have heralded CCNC as a positive force in patient care as well as a reliable program for reducing state expenses. According to NC Health News, “North Carolina has one of the highest Medicaid participation rates for physicians, and doctors say that’s because they’re given autonomy under CCNC to improve their practices.” The Senate proposed reassigning these duties to managed care agencies. The House opposes this and instead planned to retain CCNC. As of this writing, the bill signed by the governor provides “[a] plan for transition of features of the contract with the [CCNC] to the new delivery system.”

With the privatization of Medicaid in North Carolina, the state Medicaid office will eventually be terminated and the new Division of Health Benefits will replace it. The first director will be appointed in 2021. For more information about changes to Medicaid in North Carolina, subscribe to our blog and be sure to check off ‘elder care’ as one of your subscription topics. Also, follow our elder law attorneys on Twitter and Facebook.